Russia’s Putin says Europe only has itself to blame for surging gas prices

The European Union can only blame its own policies for record gas prices as some of its members resell cheap Russian gas at much higher prices within the bloc, Russian President Vladimir Putin said on Friday.

Putin also called on the EU to approve a new Russian gas route, the Nord Stream 2 pipeline, to ease the price crunch.

Europe’s benchmark gas price climbed to a new record on Tuesday, up almost 800 percent since the start of the year. The price eased on Friday, but it was still up more than 400 percent.

Nord Stream 2 is opposed by the United States and particularly several east European states, which say the pipeline will make the EU even more reliant on Russian gas, which already supplies 35 percent of the bloc’s gas needs.

The pipeline from Russia to Germany, which was built in September, is still awaiting regulatory approval from Berlin and Brussels.

“The additional gas supplies on the European gas market would surely reduce the price on an exchange, on the spot (market),” Putin was quoted as saying by news agency RIA at a joint meeting of the State Council and a council on science and education.

Adding to the squeeze, the Yamal-Europe pipeline that usually sends Russian gas to Western Europe was flowing in reverse for a fourth day on Friday, pumping fuel from Germany to Poland, data from German network operator Gascade showed.

Russian gas giant Gazprom has not booked gas transit capacity for exports via the Yamal-Europe pipeline for Dec. 25, auction results showed.

Gazprom usually books capacity via the route on a short-term basis, after Poland and Russia chose not to extend their long-term transit deal last year.

Putin said Poland had “sidelined” Russia from managing the Yamal-Europe pipeline, which has been working in reverse mode by sending gas eastward. The pipeline runs from Russia to Belarus and further to Poland and Germany.

“This does not increase the Russian gas volumes on the European market, so the price is rising,” Putin said according to Interfax news agency, about the reverse flows.

Putin said on Thursday that Germany was reselling Russian gas to Poland and Ukraine rather than relieving an overheated market.

In Ukraine, another transit route for Russian gas to Europe, the head of state gas transmission operator said Gazprom had reduced daily gas transit across Ukrainian territory to 87.7 million cubic meters (mcm) from 109 mcm.

“The reduction in gas supplies to the European Union at a time when prices reached $2,000 suggests that these are not economic decisions but purely political ones, aimed at increasing pressure on the EU to launch Nord Stream 2 on terms of the Russian Federation,” Sergiy Makogon wrote on Facebook.

The benchmark European gas price soared above 2,200 euros ($2,495) per 1,000 cubic meters on Tuesday.

Makogon said Europe had set a record for extracting gas from storage because of supply shortages.

Russia has repeatedly dismissed charges it has played politics over gas and says it is meeting all the amounts it is contracted to supply. Companies with supply deals have also said their contracts have been met.

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